Arbutus Biopharma (ABUS) risk factors, FY2024 10-K

Risks Related to Our Business, Our Financial Results and Need for Additional Capital

1. 01We are involved in multiple patent infringement lawsuits in multiple jurisdictions to protect and assert our intellectual property rights against large, well-capitalized companies, which requires that we continue to expend substantial resources, and we may not be successful in these proceedings
2. 02We are in the early stages of our development, and there is a limited amount of information about us upon which you can evaluate our product candidates
3. 03If we are unsuccessful in accomplishing these objectives, we may not be able to develop our product candidates, raise capital, expand our business or continue our operations. The approach we are taking to discover and develop novel product candidates is unproven and may never lead to marketable products
4. 04We have incurred losses in nearly every year since our inception and we anticipate that we will not achieve profits for the foreseeable future. To date, we have had no product revenues
5. 05We do not generate revenues from product sales and may never be profitable
6. 06Risks Related to Development, Clinical Testing, Regulatory Approval, Marketing, and Coverage and Reimbursement of our Product Candidates
7. 07Our development programs are at an early stage of development. We must demonstrate our product candidates’ safety and efficacy in humans through extensive clinical testing, which is expensive and time-consuming and requires specialized knowledge and expertise
8. 08Any of these occurrences may harm our business, financial condition, results of operations, cash flows and prospects significantly
9. 09Because we have limited resources, we may decide to pursue a particular product candidate and fail to advance product candidates that later demonstrate a greater chance of clinical and commercial success
10. 10Several of our current clinical trials are being conducted outside the United States, and the FDA may not accept data from trials conducted in locations outside the United States
11. 11Before we can commercialize our product candidates in the United States, we must obtain approval from the FDA. We must similarly obtain approvals from comparable regulatory authorities to commercialize our product candidates in jurisdictions outside the United States
12. 12Disruptions at the FDA, including due to a reduction in the FDA’s workforce and/or inadequate funding for the FDA, could prevent the FDA from performing normal functions on which our business relies, which could negatively impact our business
13. 13If a particular product candidate causes undesirable side effects, then we may be unable to receive regulatory approval of or commercialize such product candidate
14. 14Identifying and qualifying patients to participate in clinical trials of our product candidates is critical to our success. The timing of our clinical trials depends in part on the speed at which we can recruit patients to participate in testing our product candidates
15. 15It may take considerable time and expense to resolve the clinical hold that has been placed on our IND application of AB-101 by the FDA, and no assurance can be given that the FDA will remove the clinical hold, in which case our business and financial prospects may be adversely affected
16. 16Current and planned clinical trials may be impacted as a result of the military action by Russia in Ukraine
17. 17Even if our product candidates obtain regulatory approval, they will remain subject to ongoing regulatory requirements and oversight
18. 18We face significant competition from other biotechnology and pharmaceutical companies targeting HBV
19. 19approvals of those product candidates in the United States and other countries. Many of our current and potential future competitors also have significantly more experience commercializing drugs that have been approved for marketing
20. 20We are largely dependent on the future commercial success of our HBV product candidates
21. 21We may incur substantial liabilities and may be required to limit commercialization of our products in response to product liability lawsuits
22. 22Coverage and adequate reimbursement may not be available for our product candidates, which could make it difficult for us to sell our products profitably
23. 23Failure to comply with the United States Foreign Corrupt Practices Act (FCPA), and potentially other global anti-corruption and anti-bribery laws such as the Canadian Corruption of Foreign Public Officials Act, could subject us to penalties and other adverse consequences

Risks Related to Our Dependence on Third Parties

1. 24We depend on our license agreement with Alnylam for the commercialization of ONPATTRO™ (Patisiran)
2. 25ONPATTRO sales have declined each of the last two years due primarily to sales from Alnylam’s next generation RNAi product AMVUTTRA cannibalizing sales of ONPATTRO. If Alnylam’s sales of ONPATTRO continue to decline, the royalty entitlement may never revert back to us
3. 26We depend on Qilu for the development and commercialization of imdusiran in China, Hong Kong, Macau and Taiwan
4. 27If conflicts arise between our collaboration or licensing partners and us, our collaboration or licensing partners may act in their best interest and not in our best interest, which could adversely affect our business
5. 28partners or to which our present partners or any future partners have rights, may result in development delays or the withdrawal of their support for one or more of our product candidates
6. 29We rely on third parties to conduct our clinical trials, and if they fail to fulfill their obligations, perform services in a satisfactory manner, and/or comply with applicable legal or regulatory requirements, our development plans may be adversely affected
7. 30We rely exclusively on third parties to formulate and manufacture our product candidates, which exposes us to a number of risks that may delay development, regulatory approval and commercialization of our products or result in higher product costs

Risks Related to Our Intellectual Property

1. 31Other companies or organizations may assert patent rights that prevent us from developing or commercializing our products
2. 32Certain of our patents and patent applications have been challenged and found to be invalid, and additional challenges may occur in the future, which could adversely affect our business
3. 33Confidentiality agreements with employees and others, including collaborators, may not adequately prevent disclosure of trade secrets and other proprietary information

Risks Related to the Ownership of our Common Shares

1. 34The concentration of common share ownership will likely limit the ability of the other shareholders to influence corporate matters
2. 35Entities associated with Roivant Sciences Ltd. (Roivant) collectively held as a group approximately 20% of our outstanding common shares as of March 25, 2025
3. 36We are incorporated in Canada, with our assets located both in Canada and the United States, with the result that it may be difficult for investors to enforce judgments obtained against us or some of our officers
4. 37If we are deemed to be a “passive foreign investment company” for the current or any future taxable year, investors who are subject to United States federal taxation would likely suffer materially adverse United States federal income tax consequences
5. 38Our articles and certain Canadian laws could delay or deter a change of control
6. 39Our success depends on our new management team and Board of Directors, which is conducting a review of our pipeline and development plans for our hepatitis B programs
7. 40We could face liability from our controlled use of hazardous and radioactive materials in our development processes
8. 41Our business, reputation, and operations could suffer in the event of information technology system failures, such as a cybersecurity incident
9. 42We may acquire other assets or businesses, or form strategic alliances or collaborations or make investments in other companies or technologies that could harm our financial condition, results of operations or cash flows, dilute our shareholders’ ownership, incur debt or cause us to incur significant expense